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Challenges and opportunities for UK from new EU pharma policy

30 March 2021

The European Scrutiny Committee has asked the government for a detailed response to European Union (EU) plans which could have a significant impact on the way medicines are developed and marketed in the UK.

Report findings

The call for an explanation of the government's position comes in the latest regular report by the Committee which scrutinizes proposed or new EU legislation that could have an impact on the UK.

The request for information from the government follows the publishing by the EU of its new, wide-ranging strategy for the future of the pharmaceutical sector.

This is significant for the UK because, under the Brexit deal agreed by the UK and the EU, Northern Ireland must remain aligned—as in some other areas of legislation—to EU pharmaceutical sector rules. 

This means the EU has the right ultimately to decide, among other matters, which medicines can be sold in Northern Ireland.  

The December 2020 Brexit deal (known officially as the Trade and Cooperation Agreement) also said that pharmaceutical legislation was an area where the UK and the EU had agreed to cooperate. This included a provision for regulatory cooperation. 

The new EU strategy for the pharmaceutical sector includes suggested changes in legislation on medicines used for rare illnesses and conditions (so-called 'orphan medicines') and medicines used in the area of paediatrics.  

The strategy has been published by the European Commission. It seems likely to lead to legislation and so will probably affect the market for medicines in Northern Ireland. 

For example, the European Scrutiny Committee report said it is possible that a medicine authorized for use in Northern Ireland might not be authorized for use in Great Britain, or vice versa.  

At the same time, the EU strategy could also have wider impact, including on the UK as a whole.

This is because new EU rules could influence competitiveness or cause divergence between the UK and EU markets in the sector, thereby influencing decisions about how pharmaceutical companies invest in the UK and the EU. This could present both challenges and opportunities for the UK.  

The EU plans are based on the hypothesis that the commercial incentives of pharmaceutical companies to innovate are not necessarily aligned with the interests of patients—and, therefore, that the sector needs to be reviewed.

The aim of the strategy is to ensure that EU citizens have access to innovative and affordable medicines, as well as to support the competitiveness, innovative capacity and sustainability of the sector.  

The four strands of the EU strategy are: 

  • reviewing and where necessary tailoring incentives, such as patent protections, to satisfy unmet medical needs – for example the need for new antibiotics
  • supporting competition and innovation in the sector, by for example simplifying legislation
  • focusing on resilience of supply and environmental sustainability
  • promoting regulatory convergence and international standards to encourage safe, high quality and affordable treatments globally

Letter to the Minister of State for Health

In light of the new EU strategy, and the agreement by the UK and the EU to cooperate in the pharmaceutical sector, the European Scrutiny Committee has written to the Minister of State for Health, Edward Argar MP.  

The Committee said in its letter that it was of fundamental importance that the EU intended to change its pharmaceutical legislation, including rules on orphan and paediatric medicines. 

The letter said the Committee required from the Minister an outline of the government's plans in response to the EU strategy.

If the government had no such plans, the letter said, the Committee asked the Minister to explain clearly why this was the case.  

The letter also asked:      

  • the government's view on the hypothesis that commercial incentives in the pharmaceutical sector are not aligned with patient needs and therefore need reviewing
  • what would be the risks or opportunities for the UK in the event of divergence between UK and EU approaches to pharmaceutical innovation
  • what opportunities the government sees for UK-EU research cooperation in the development of pharmaceutical products, given the planned UK participation in the EU's scientific research programme, Horizon Europe
  • whether the government sees any benefits for the UK in encouraging other countries to strengthen their regulatory and intellectual property (for example patent) standards
  • why the UK is not a member of some international pharmaceutical regulation organisations
  • what the government's own ideas are for addressing unmet medical needs, ensuring accessibility and affordability of medicines, and promoting innovative, sustainable and patient-oriented pharmaceutical development.

Further information

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